Good morning, everyone, and welcome to the Darling International conference call to discuss the company's fiscal third quarter 2013 financial results. With us today are Mr. Randall C. Stuewe, Chairman and Chief Executive Officer of Darling International; and Mr. Colin Stevenson, Executive Vice President and Chief Financial Officer. [Operator Instructions] This call is being recorded, and your participation implies consent to our recording this call. If you do not agree to these terms, simply drop off the line. I would now like to turn the call over to Melissa Gaither, Director of Investor Relations for Darling International. Please go ahead.

Thank you, Denise. Good morning. This conference call will contain forward-looking statements regarding Darling International's business opportunities and anticipated results of operations. Please bear in mind that forward-looking information is subject to many risks and uncertainties. The actual results may differ materially from what is projected. Many of these risks and uncertainties are described in Darling's Annual Report on Form 10-K for the year ending December 29, 2012, our recent press release announced yesterday and other filings with the SEC. Forward-looking statements in this conference call are based on our current expectations and beliefs, and we do not undertake any duty to update any of the forward-looking statements made in this conference call or otherwise. With that, I would now like to turn the call over to Randy.

Thanks, Melissa. Good morning, everyone. Thanks for joining us. This has been a very busy and exciting quarter for the company. I'd first like to discuss our financial results for the third quarter that ended on September 28, and then I will change my focus to the recent acquisitions that will transform Darling's platform into one that creates sustainable food, feed and fuel ingredients for a growing population. Our third quarter performance remained fluid, but consistent with our second quarter 2013 results amid a major global resetting of commodity values for corn, soybeans and other ingredient alternatives to their lowest levels in nearly 4 years. Our Rendering segment delivered strong results compared to second quarter 2013 with the Bakery segment feeling the brunt, as anticipated, with the realization of declining cash corn prices as harvest progressed. On an adjusted EPS basis, we delivered $0.32 a share. This takes into consideration acquisition-related costs of $8.3 million and nonoperating settlement of $2.4 million as discussed in the press release. Combined, these nonrecurring costs impacted the earnings per share by approximately $0.06 per share. Additionally, as we made you aware in August, Diamond Green Diesel was still in its shakedown period and would operate at a reduced rate due to metallurgical failure until new equipment could be fabricated and installed. The impact of this reduced rate lowered EPS by another $0.03 per share. As we noted in our press release, a decision was made yesterday to shut down the facility temporarily to replace these failed pieces of equipment. The replacement parts are on site and repairs are now underway. We anticipate being back up or exceeding nameplate capacity by mid-November. During the quarter, and on a sequential basis, Rendering raw material volumes remained steady with poultry and yellow grease volumes more than offsetting…

Thanks, Randy. For the 2013 third quarter, the company reported net sales of $425.8 million compared to $452.7 million in the year ago period. The $26.9 million decrease in sales primarily resulted from lower finished product prices for fats and pet grade proteins, which more than offset increases in finished product prices for meat and bone meal. The year-over-year decrease in fat prices resulted from several factors: lower prices in the overall commodity markets in the oilseed complex, reduced corn values, lack of export demand and decreased biofuels demand. Raw material volumes declined year-over-year, but were partially offset by an increase in other Rendering segment sales and higher collection and processing fees resulting from the Terra Renewal Services acquisition. Net income for the fiscal 2013 third quarter decreased from $37.2 million, or $0.31 per share on a fully diluted basis, to net income of $27.2 million (sic) [$27.7 million] or $0.23 per share when compared to the 2012 comparable period. As noted in our press release, the $9.5 million decrease in net income for the third quarter resulted primarily from several factors, including lower finished product selling prices, primarily within the Bakery segment; nonrecurring costs of $8.3 million in acquisition-related costs; and the $2.4 million payment made pursuant to the purchase agreement relating to the acquisition of Griffin Industries to reimburse former Griffin shareholders for certain state income tax liabilities resulting from our 338(h)(10) tax election. At the segment level, Rendering generated net sales of $362.1 million for the third quarter as compared to $368.2 million in the third quarter of 2012. The reduction of $6.1 million resulted from lower fat prices. Bakery segment sales contributed $63.7 million to the third quarter as compared to $84.6 million in the year ago period or a reduction of $20.9 million. This is…

Thanks, Colin. We've executed well so far through the global commodity resetting and ended the first 9 months of the year on an upward trajectory while executing on our global long-term growth strategy. As an international force with a portfolio of global brands, we continue to make our mark as a leader in creating sustainable ingredients for a worldwide marketplace. Our enterprise is solid with unmatched leadership at all levels, and we are excited about the opportunity to better serve our global suppliers and customers while creating sustainable long-term shareholder value. With that, Denise, I'd like to go ahead and open this up to questions and answers.

[Operator Instructions] And our first question will come from John Quealy of Canaccord Genuity.

So 3 questions. First, Randy, on Diamond Green, can you talk about the mix of substrate through the plant? Was it a lot of corn oil or animal fat thus far and can you comment on that? Secondly, Rothsay just closed. I imagine you've had a chance now to dig a little bit deeper into the books and talk to some people. Can you talk anymore about any potential synergy or cost recovery? Or what your approaches there now that you can see some more details? And then lastly, as much as you're comfortable with, speculate a little bit about the RFS controversy. What you think it does to corn and how the Darling model can respond now that you've got a couple more businesses there?

Okay. Let's talk about Diamond Green Diesel and then we'll transition to the RFS, and then I'll talk a little bit about Rothsay. Diamond Green Diesel really had a pretty good quarter in the third quarter. It's kind of -- you always have to keep in perspective that this is serial number 01 of multiple technologies that have been bolted together. And to think that on June 28 we pushed the go button and within a couple of weeks we were 70% of capacity and within a couple of weeks after that we were at capacity. What we found during the process of running the plant is that we're getting some reactions of -- within some of the heat exchangers that are causing corrosion. And thus, we decided, rather than get up and run at higher rates for sustained periods of time and then have a failure, to go ahead at the front end here and replace the heat exchangers with some different alloys that aren't susceptible to the corrosion. UOP was a technology provider. They've worked hand in hand with the Valero engineering team and I think we've got some pretty good solutions. As we talked about yesterday, the plant was put -- started to cool down and depressurize yesterday. The plant is down this morning with all the equipment on-site to be installed over the weekend. And hopefully, we'll begin warming back up early next week such that when we do host our -- an opening down there next week, that there will be -- the plant will be at full production with hopes of exceeding full production in the very near future. To comment about the feedstock supply, pretty typical, John. It was a -- I want to say about 1/2 of the feedstock came from Darling,…

The next question will come from Dan Mannes of Avondale Partners.

First, quick follow-up on Green diesel and certainly appreciate your comments. This is your first full quarter of operations for a "first of a kind" plant. I'd say, given what we've seen maybe from other people, I would say your success rate in the first quarter far exceeds what other people have. So it looks like it's been a strong performance. But that said, given maybe some of the pro forma numbers you've given in prior quarters and given how strong, at least, the spreads were, given where we're in the price bordering the third quarter, I guess we thought the numbers would be a bit higher. So can you maybe walk us through what the actual production or sales volumes were? And maybe give us a little bit more color maybe on what spreads were at the plant?

Yes, I'll give you some more color, Dan. A decision's been made at this time to not release gallon production because we're still in shakedown period. I think there's a combination of a couple things that went on down there: number one, nominally, the nameplate's capacity is about 9,300 barrels a day. We've assumed basis, the process guarantees and everything, a low 90s type of yield. We came close to that, but we're not there yet. We were still fine-tuning the isomerization unit. For the layman on the phone, including me, that's the unit that adjusts the cold flow or cold point of the product and basically you either make liquid or gas. So we were making more gas than we were liquid as we got to learn to run the unit. So initially, in Q1 of operation here and you had the slower start-up the month of July, up to full speed, then you start fine-tuning the units to try to get your split by isomerization. And then we found that we weren't getting the isomerization split we wanted, which then said we had a leak somewhere in the system, which happened to be the heat -- main heat exchanger of the unit, which we then shut down for 3 days, opened it up, it cools down a day, depressurizes a day. You have to purge it to get everything out. Then you can open it up and go in. And then it takes you another 3 days to come back up and we found excessive wear within that heat exchanger on the cool side of it from the corrosion off of the condensate. So a decision was made to order an ultrasophisticated alloy into that. It was a surprise to UOP that, that was actually a performance fault…

That's a really good color. if I could just ask you just maybe a little bit of a different way. In prior quarters, you've kind of given us a pro forma number of what it would have been had it been running full output with sort of where market spreads were. If you ran that number, would that be sort of the, I guess, the $0.09 or so, which I guess the real performance plus the $0.03 you're missing? Or would that number have even been higher this quarter kind of on a pro forma basis if it ran the way you had thought it would in prior quarters?

Between yield and margin spread that was out there, it would've been higher. The unit's doing what we think it -- thought it would do. Admittedly, as we learn to run it, yes, we impacted feedstock prices down there in third quarter. To a degree, we almost -- we ran low on inventory. Thus, we ran some soybean oil down there that narrowed margins quite a bit on. And so when we backed into the adjusted number there, it was kind of what we felt we left on the table at a higher rate, not at a -- had all -- had the yield been right and if the margin's been executed properly. The team did a marvelous job and I don't want anybody to take away that they didn't. It's just when you look at it, we left an easy $0.03, $0.035 on the table down there.

Understood. And again, I want to reiterate, I mean, given what we've seen at some competing plants and start-ups, this has been a much cleaner start, at least so far. Two other quick ones, first on Rothsay. We did see some data, at least, out of Maple Leaf that showed the stand on Rothsay economics. It looked like the margins structure there is dramatically better than what you guys are running here in the States. Can you talk maybe about some of the structural differences that Rothsay carries and maybe some of the opportunities that may present?

Structurally, it's a location of plants. When you have -- in the margins, and Darling has similar plants with similar margins in United States. So collectively, when you mix -- we've got a mix of plants that have different competitions in different regions. So I never wanted to position that, overall, that there's something dramatically different up there. The biodiesel business up there had and has is one of the best operating biodiesel plants I have ever been around and it's a very successful both from a margin and operating plant to basis. So that's a big contributor underneath the business. When you strip back the core Rendering business, it's a location issue. Their dedicated value-added products being made from porcine and chicken. The Dundas plant is a large beef plant. But for the most part, more field in Winnipeg are dedicated to pork and Hickson is dedicated to chicken. And so, at the end of the day, those are making more specialty products that give us a little bit wider margin than -- which would be similar to our Newberry, Jackson plants that make specialty products. So it's really a product mix issue, a little bit by location, but keep in mind, biodiesel up there is a very good business, too, for us.

Okay. And then one last quick one, just on SG&A. First of all, given the number of acquisitions you've been involved with, can we assume you'll have some acquisition costs in the fourth quarter? And number two, can you talk maybe about the implementation on the ERP and just, is that -- is the rate of spend there going to carry forward through '14? Or perhaps will we see some step-down there?

Dan, this is Colin. Yes, we will have a fairly significant level of acquisition-related costs, frankly, both in Q4 and there'll be some carryover into Q1 of next year as we close VION early in our first quarter. So yes, you should expect those. Secondly, as it relates to the ERP, it's going well. We have rolled out a couple of key modules to date including general ledger, fixed assets, some of the back office stuff. We've also rolled out HR and payroll and those had went well. We will be on a pretty consistent run rate through '14. So I would include that as you think about the SG&A rate.

Our next question will come from Farha Aslam of Stephens.

First question is on Darling's base business. Your press release highlighted corn hedges. Could you just share with us roughly how those contributed to the quarter, and what we should expect going forward from those hedge positions?

Yes. And I think we've been fairly and very consistent about our beliefs since last February that we had a view that if the American farmer was given normal weather, they'd grow an incredibly large crop. And given that where we were at with the blend wall in ethanol, the additional bushels would weigh on the market. So given that we knew that or believed that, we initiated a program in our Bakery division to lock in margins. We buy off of Central Illinois corn. Most of the product heads to the Southeast United States, which trades trade-off of Central Illinois. And so we have different purchasing agreements with different raw material suppliers and sales agreements with different customers that allowed us to go in and put a derivatives position on to margin that business. As we had said in the past, we anticipated that we would lock up the entire year and deliver earnings somewhere around $55 million in that business. Now that's down from $68 million last year. But at the end of the day, that was going to be about the best you could do when we saw the inversion in the corn market. We started putting on product when we were in that mid-5s on corn, $5.50, $5.80. But yet, the market was highly inverted down to $4.50. So we carried that position out throughout the year all the way to fourth quarter. We called it a rolling 32-week program. We have now carried that program or did carry that program out during third quarter all the way out till the end of June next year. So in the quarter, it contributed about $2 million of earnings. I think we put up around $12 million of -- within the Bakery division for segment for the quarter. And about $2 million of it came from the hedges that had been put in place. It's a very easy business to margin if you have a view there. So the team did a nice job of executing and lifting the hedges as the sales were fulfilled.

And Farha, based on where values were at September 28, as we disclosed in the Q, it was about $2.9 million of, let's call it, hedge gain that we would expect to roll through the P&L over the next 4 quarters.

Four quarters. Okay, that's very helpful. And then when you look at the Terra business that you've now have for a little bit, could you share with us any actions that you've taken that you've -- would get synergies from that business? And then, your thoughts on building out that hexane technology over time?

Yes, I think the 2 are related, but let's talk about Terra first. The Terra business was a couple different segments. So their Food Service business, I think, if I remember, there's about 9 locations that collected used cooking oil. Those have all been integrated. In most cases, they were either owned or leased sites that were operated by Terra. We have shut down those sites. The magic of the Terra acquisition for us was that all 9 of those sites actually matched up over top of our sites. And so it was a very simple route integration, something we've done consistently and well over the last 10 years. So that's done. Volumes are about as anticipated, as we expected. We picked up some very large accounts that Terra was successful in doing business with that we weren't. We've maintained the Terra management team with Todd Mathes and Mike Brooks, and they're doing just a fabulous job of bringing the relationships to us and helping us maintain some growth with some big change that we didn't have before. So that's the food service side. Keep in mind, we closed, I think, about the end of August, August 26 or 28, something like that. And so we had about a full month and a couple days of operation in the quarter. The land application business has really been exciting for us to learn. Mike Brooks is managing it for us. The revenue is where we thought it would be, the earnings are as good as we thought they would be, if not a little better. And the opportunities to connect one more time with each of our suppliers is proving to be a real opportunity, one that I don't think we've got our minds around yet as to what kind of…

And Randy, my final question is if you both get the Terra, Rothsay, VION and Darling businesses, could you just share with us what the EBITDA earnings capability of that business is? And the commodity exposure that, that business has?

I think we're going to let the EBITDA side trickle out over time. I mean, obviously, you know what ours is. We've talked about Rothsay in the press release, at CAD 80 million. We talked about the VION at EUR 200 million. So if you use a EUR 135 million rate, you got EUR 270 million there and USD 75 million up at Canada. We talked about TRS being in the low 20s. So you can kind of add it all up and come up with the number. So the most important thing, as we go to the debt and equity markets and we start to put the long-term capital structure in it, is explaining to both our investors and our debt-holders what the true commodity exposure will be. And as we said, as we took over the company here and -- that dates back to 2003, for me, we looked at this thing and we had about little less than half of it on some type of fixed margin formula basis. It was very hard to achieve proper financing with that. So we made a concerted effort to move more and more to some type of predictable margin business. When we added the Griffin team to our family, we learned the poultry business and we learned a methodology that was very similar to ours, but one focused on value-adding, and at the end of the day, would share with suppliers some of the value-addition and put some of it within our own P&L. And it became a very lucrative way of improving the suppliers' economics, helping them grow and ensuring us a chance to grow faster than the others participants in the market. When you put Rothsay on, at the end of the day, you've got a different model…

Our next question will come from Carla Casella of JPMorgan. Carla Casella - JP Morgan Chase & Co, Research Division: One question on the acquisitions as well. Just given the number of transactions you've made, has your view towards your target leverage changed going forward? And what -- do you have a target?

Yes, Carla, it's a great question. It's one we described as we met with investors, and as I said, the debt and equity offerings are being prepared. The lead-in question that Farha asked about the EBITDA rollouts and the commodity exposures, given that we've reduced the commodity exposures and we've got a very diversified earnings and revenue streams on 5 continents around the world, it says to us that we can move our leverage tolerance up quite a bit from what it's been in the past. We always, I think, we've always been very clear to our shareholders that we've always talked that it was always called the John Muse or the Muse rule around here, which said 2x, 2.5x delevered as quick you can. But really, implicit under that analysis was to always have one turn of availability under your revolver. Colin has been incredibly successful with the support of the banks out there of giving us $1 billion revolver underneath this. We've announced the term loan B that will be put underneath it, and we'll be announcing in the future the debt and equity side that will support long-term capital structure. The long term, when we start to look at this thing, I think we start look at it and say, we're comfortable at a 3, 3.5 turns number going forward. Obviously, we have to learn the business around the world and make sure that the assumptions that we have in our models today are correct. But it looks pretty solid there. Always, we want to maintain dry powder. The beauty of putting all these companies together, aside from the great management teams, is that the great management teams have the same vision we do: They want to grow. And so, we've got to make sure that we've got availability as we can see around the world the opportunities. I used the line, "We can see what no one else can see today," because we get to see it on all continents from rendering to blood, to gelatin, to the different businesses, the opportunities that exist around the world. And we want to make sure we have capacity to participate in those opportunities. Carla Casella - JP Morgan Chase & Co, Research Division: Okay, great. And then just one question on Europe. You mentioned the soft European demand for the fats affecting your business a bit in the third quarter. Do you have a sense for how much that may have affected VION in the recent period?

I didn't mention anything about European softness. The comment I made was we saw a continued slowness in the pet food and aquaculture markets, and then we saw the fat side be actually very, very strong through the summer here. Exports remained limited but really, the overriding issue underneath the global ingredients business for the commodity-based ingredients was at any time near an inverted market, people delayed forward-purchasing decisions. And we saw this back in 2012 in the first quarter, as everybody anticipated, the market's going lower. They didn't buy, and then they came back when it didn't rain in '12. So we didn't really see much of anything. VION's third quarter was very, very solid, as predicted, and looks very strong going into fourth quarter here for -- as predicted and communicated fourth quarter here.

Our next question will come from William Remer of Maxim.

VION. Can you give us sort of a ballpark of how you're thinking about financing this between the debt revolver equity, just in terms of underlying percentages there?

Bill, as we've described and submitted on the 8-K, we're planning on having a term loan B out there at $1.2 billion. And as we've announced, we've got commitments for a bridge at $1.3 billion. We have plans to refinance the bridge, as we discussed, subject to the equity markets hanging in there. That, plus a high yield or a public debt instrument.

Okay, good. And then a couple of housekeeping questions for you, Colin. As we integrate everything here, what's a good tax rate going forward?

As we described in the past, our U.S. rate runs in the 37%, a little over 37% is sort of where we structurally come out. Canada has a lower rate, Bill. Their rate is something more in the, call it, the 27% range. And I think for the roll up of VION, I would think that somewhere in the 29% range would be a reasonable estimate.

The next question will come from Ken Zaslow of Bank of Montréal.

A couple of questions. One is, can you just walk through the financial impact if the dollar biodiesel credit goes away?

Well, I can give you 2 scenarios. Given even -- if RINs don't move and where we're seeing ULSD and feedstock prices today, you can sit there and still say, Diamond Green Diesel makes $0.50 to $0.60 a gallon even with a low-30s RIN. Now I don't believe that from the standpoint that I don't believe that the other portion of the biodiesel industry or biomass-based diesel industry, which is a product that is absolutely necessary to fulfill the RFS mandate, that those guys can run at that rate. And so I think that you'll see RINs come up substantially. I anticipate, and this is just me looking at it, I anticipate that, that plant will run in the margins again for next year. Even if we don't get any movement on the mandate, we'll be in that $0.80 to $1.20 a gallon range going forward next year.

Great. So my next question is, what is your ability to have early detection signs of any issues in the joint venture? It just seems like -- I know you guys excluded the $0.03 this quarter, and I hope that it's an excel item forever. But how do you kind of regulate if -- and you kind of said, hey, this is serial number 001. How do you regulate that there's no other issues coming? How comfortable are you with that? Can you give some sort of comfort level that we should be thinking about?

The basis for -- and I'm not a petroleum or chemical engineer, and the guys down -- Gary Steckel [ph] and his team down in New Orleans are doing a fabulous job. I mean, as you can imagine, the control room on this facility looks like NASA. And basically, you regulate plant performance or judge plant performance on the finished product output as an inspect if something moved. And when you say has something moved, you're talking between 2 and 4 decimal places on measurement of the finished product. And so, at the end of the day, when we shut down for the initial heat exchanger issue, we did a lot of metallurgical checking. We -- at the end of the day, we didn't -- we made a lot of assumptions in that, some were good, some probably weren't exactly accurate at the time, but nonetheless, it was a very educated. The question that I was asked when I was down there for a board meeting last Thursday, I asked the question, "Are all the demons out of the pipes yet?" And the looks across the table was, "We think so." The good news is, as I said, the facility that we thought we would have the issue with was pretreatment, and it's absolutely been running at what we've been able to. If you break the plant down, as we look to what it can do today and what we're hoping we could do with it tomorrow, the rail unloading system is first-class. It's a Ferrari, it's exceeded our expectations. We've unloaded 45 cars a day down there. The pretreatment facility has been able to outrun the plant and run with a higher quality and lower usage of different inputs that we anticipated and modeled. And then, the hydrotreater, which is what I would call Valero's fairway, their expertise, everything here is pretty normal to what they're used to running with the exception of one thing. When you look at crude oil and when you look at vegetable oil or triglycerides, the hydrotreater, this unit is being used -- constructed to remove oxygen and water. And with water, it's where we're having the issues. That's the piece that they're working through. And at the end of the day, if we would've known what we know now, those heat exchangers would've been fabricated out of some high-end alloy at the start. But that looks to be the last bottleneck. Like I said, in early July, we were running 10,000 barrels a day down there. And so, we know the facility can run. These are the 2 things that are left. But as the lawyers are always telling me, it's the best I know now, and hopefully, it goes that way.

And my other question is, if I strip out the $2 million of hedge gain and you said, look, we operated fantastically with the lower corn prices, is this quarter a good representation if I take out the $2 million of what your earnings power should be in this corn environment going forward?

You're speaking to the Bakery segment?

No, the whole company. I was actually -- if I strip out the 10 for the Bakery, keep the Rendering where it is, because you said that the business is not that [indiscernible] a big hit on corn and let's say the hedge gain doesn't come back. So my sense is that the whole company, is this the right earnings base for your core legacy business, or in this corn environment?

I wish it was that simple. I mean, number one, in the Bakery side, we still got a couple of million dollars of hedge gains that are still out there. The Diamond Green Diesel business has some margin to business. We're thinking and believe in the fourth quarter, you always see the pet food business spreads start to widen again. Those narrowed substantially in third quarter. I mean, we have seen in October prices fall off a little bit more from third quarter. But as I said, the formulas are stabilizing. So I don't know that I want to go out in front and say, is this a normalized thing, because there's a lot of moving parts here. If Diamond Green Diesel comes up early next week and begins to run hard, it will start pulling hard from the fat markets again here towards the end of the year. And so, I don't know that I want to step forward on any more than that, Ken.

The next question will come from Craig Irwin of Wedbush Securities.

So when I look at the benefit of having biodiesel production for Darling and the sort of counter-cyclicality of the biodiesel market to the feedstock market, conditions like what we've seen recently where fast profitability might see a little bit of compression, it's usually a pretty exciting time for the biodiesel producers. And I look at the success that you've had and the trajectory, sort of what you've laid out as far as what is possible out of this facility. It seems like it would be ideal if you could maybe build another facility of similar size or maybe double the facility, as far as being able to really smooth out the longer-term earnings trajectory? I was wondering if you could comment about whether or not that's something that you would consider, and whether or not there was an opportunity to do something similar with the assets of VION internationally?

Well, I think to address the first thing is, obviously, we want to get, as we said, the demons out of serial number 01. Once we achieve nameplate capacity, the next question then is, how much stretch do you have within the system itself, both inbound logistics, outbound, reactor capacity and pretreatment? That study is underway right now. I mean, we run the same spreadsheets you do. We understand the money we left on the table in third quarter and what we've left on the table so far in fourth quarter. And it certainly says the right investment and incremental decision within the Darling Valero system is to debottleneck the plant as much as we can and get as much out of it. Additionally, as we begin to think about number two, we are also looking at the low carbon fuel standard, which is just in its infancy. Out on the West Coast, you're seeing premiums of $70 to $80 a ton for product that can get out there. Unfortunately, the freight to get it out there today is about 80% to 90% of that if you have the rail cars available to get it there because the pipelines don't run east, west in that direction. So we're looking at all things. I would categorize it upfront here as number one, to get Diamond Green Diesel up the nameplate; two, see what we can -- how far the accelerator will go before we hit the pedal to the metal; what capital is required from there to see if we can make the car go faster; and then once we understand that and the markets hold and no one messes anymore with RFS than what's already been discussed, I think number two is clearly an opportunity. Relative to VION, the opportunity probably isn't to build one of these outside of the U.S. because of the RFS. Neste has done that. They're very successful at it in doing that for us. It just doesn't look like something we'd want to do in Europe today. The European model that the other brand, that the VION team works with is Ecoson, which is a digesting and methane production business. Energy is very expensive on the continent. And so we do probably are going to put our money into further electrical generation and then digesting technologies for gas to create heat for the plants over there.

Great. And then just a follow-on. So Gina McCarthy has said in her statement, I guess the only statement out of EPA since the supposed draft was leaked, that EPA's commitment to the growth and development of biofuels. So if we were to see an RVO consistent with what many of us were thinking after the 2013 RVO affirmation, mid-August, something maybe in the range of 1.7 billion to 1.9 billion gallons, pretty bullish RVO for biodiesel. But if we were to see something in that range, would that increase the probability of an additional plant or an expansion in the near term?

I think it's all great commentary, Craig. And I would tell you, to be honest with you, my gut has said we were in that 1.6 billion to 1.8 billion range before the debt memo came out from D.C. But you've got to step back and really, before you can go bullish on veg oil prices globally even with the change here, you got to look back now, like I said, we can see what other people can see. You've got Europe that's now building walls around it to protect their own biodiesel industry, which is -- which your decoder ring says that's to protect the rapeseed farmer. So you've got all this far east biofuel capacity that's been put in that's palm-based. You got the Argentine biodiesel business. It's got to find a home. And so I don't think it's as simple as coming in and say, if it goes to 1.7 billion, 1.8 billion, yes, I'm probably going to have a little party around here because it will be something that makes you feel pretty good, but I don't think it's a straight to the bottom line. As I was looking this morning, as I woke up early and saw the typhoon going over the Philippines, I said, "Okay, now what happens to the laurics business as that massive storm goes across that region of the world?" So I think there's lots of dynamics here. We hope that the EPA and that OMB comes out with something favorable that makes sense here shortly. The farmers deserve it, the infrastructure that many of us REGNS have put into the biodiesel and the renewable diesel business deserve it.

Great. And then last question, if I may. The Hampton extraction facility, obviously a great opportunity for you to go out and use what you've learned there over the next handful of years. Can you maybe frame out for us the potential profitability on a facility like that? I mean, how should we think about those 80,000 truckloads? Is this really just an opportunity for you to capture what would've been paid for the tipping fee? Or is there significant economic value coming out of the plant, where you could see some pretty material EBITDA from the products generated, not just from the services provided to the customers?

Well, obviously, the acquisition was made with the tipping fee being the support for the $120 million purchase price, with $20 million, $22 million of EBITDA in there. So that's the way I look at it, is I now have 3 raw materials. The challenge that we have underneath it is not all raw material is created equal, meaning that in order to coagulate or to get the solids out of that product, they use different polymers. Not every polymer that is used in a food plant is favorable to our technology to separate the fats and proteins. So it's a learning curve. And not every truckload of raw material will work within the system. So of that 80,000, if you said what is our vision, our vision is to get #2 built somewhere here in the Midwest over the next year, 1 year, 1.5 years to get it commenced under construction. The facility that we think about is one, the Hampton plant today, like I said, was a visionary pilot plant that was then put into commercial scale production here that runs about 50 tons a day of output. At the end of the day, we're looking for numbers out of the next plant somewhere to 100 to 150 tons. Capital hasn't even remotely been worked on there to come up with that number. We'll make no investment in a greenfield like this with any type of economics that are below a 4-year payback on it. So that's kind of the hurdle rate we're looking. Right now, the spreadsheet looks much better than that. But spreadsheets only gets you fired, they don't make any money here. So we'll just kind of leave it at that.

Our next question will come from JinMing Liu of Ardour Capital.

Just a couple of follow-up questions. First, relate to the repair of the heat exchangers. What's the problem, really, to adjust the water content in the system, not related to the asset content of your feedstock?

That's exactly right. I mean, JinMing, given your education level, you've got it figured out here, that it wasn't related to free fatty acids in the product. It's related to the process and the dewpoint of the condensate and the acidity coming off the system.

Okay, that's good. Very good to know. Secondly, what was the reason -- I may have missed this. What was the reason you run a vegetable during the past quarter? Was that related to the shortage of supply in the attendancy of your plant? Or simply was just was due to the price?

Yes, 3 things. One, as Diamond Green Diesel, no one, including myself, believe that serial number 01 would come up and run as fast and as hard as it did. We had a supply chain pipeline and a fat inbound to it that didn't arrive on time as we hit 10,000 barrels a day down there. So we had to substitute and find the next cheapest feedstock. And your choice of the economics of trucking material out of the Southeast, as I said, poultry fat, doesn't work to date. So we would've had to come out of the Midwest with material by truck. And it actually brought the Gulf super degum soybean oil stocks as an economic and viable alternative. And when you look at it and you say, I don't have to run it through pretreatment because it doesn't have the metals or the phosphorus content, then it became a super viable alternative with [indiscernible] being just a few miles away. It became a very nice backstop to the plant. I don't anticipate it working all the time. And right now, it doesn't work. But it will come into play from time to time. And it's good to know you've got a safety net across the street if you need one.

Okay. Lastly, just during the past quarter, what's the cash processing cost, as you projected before, for the Diamond Green Diesel facility?

The answer was no, it was a little bit higher in some places, a little bit lower in others. I mean, obviously, during shakedown period, I guess I would prefer to answer that question about 90 days or 100 days from now, when we get some constant processing underneath it. It's a little bit higher than what we had built in, if you will, our spreadsheet, but not materially higher than what we thought. And so, as we align the plant out, I think it will come very close in line to what we thought it would be.

The next question will come from Roman Kuznetzov of Gates Capital.

It's actually Jeff. Can you talk about volume outlook going into next year on the core Rendering side? It looks like you have some tough comps in the first half of the year.

The -- as we look at it, I mean, Jeff, and we spent some time during our board meeting talking about it. The poultry side looks pretty darn favorable going forward. And the poultry industry, in spite of itself, is making good money right now. The suppliers, the egg sets and broilers are growing. So we feel pretty strong there. The B side, we feel pretty neutral to a little bit of a downturn that we think we're going to continue to see there. So as we look at it, Bakery volume is steady. Used cooking oil, Brian Griffin's team is doing a fabulous job out there. Our volumes are growing again there. So I think you'll see a little bit of normal seasonality hit that business as you always do between the holidays and the first part of the year. Poultry volumes up, pork volumes steady and beef down probably 1% to 2% for us.

Okay. And then, secondly, can you give an update on the timing of accessing the debt and equity markets?

Jeff, obviously, that's subject to market conditions. Obviously, we're working through that process as we speak. The biggest thing we're trying to get done is the carve-out financials that we need.

Right. But just remind me, you need carve-out financials for the equity field, correct?

No, you need them for debt offerings as well, Jeff. So -- as I think we're looking to do. We're working through the carve-outs on both Rothsay and VION, and we're knee-deep in that process and hope to have it wrapped up here in the near term.

So if I understand it right, though, it's a lesser requirement for debt than for equity. So what's the soonest you could be in the debt market, assuming conditions were the same as today?

You're correct in terms of its -- it's a number of years requirement, right? So 2 versus 3 with respect to VION. The soonest we would get there would hopefully be before the end of the year.

Okay. And then, lastly, can you give us the sales and EBITDA contribution from Terra during the third quarter? And secondly, is there any capital costs associated with replacement of the heat exchanger at Diamond Green Diesel? Is there any business interruption insurance recovery or warranty recovery or anything like that for the lost production? And...

Yes. Let me -- Jeff, this is Randy. No, we're not going to break out Terra on that basis. It's rolled under the Rendering segment today, and it's already been fully integrated. The Diamond Green Diesel, obviously, we're in discussions with UOP on warranty and issues there, no business-related interruption here from that perspective. The capital costs for the 3 heat exchangers that are going back in is not material to the operation. It's just a swap out of the 2 bundles within the exchangers themselves [indiscernible].

And on an ongoing basis, are you going to disclose the balance sheet of the joint venture on a quarterly basis?

Jeff, we will do some enhanced disclosure related to the joint venture. As you saw, I think in this quarter's Q, we disclosed some information around assets and total revenue and net income. So we'll continue to look at the disclosure related to DGD.

For example, what's the cash and the debt of that entity today?

The investment, as we disclosed, ours is about $116 million. As we've also disclosed in the financials in the past, the debt that resides at that joint venture is about $221 million.

$221 million?

Yes.

And there's -- is there cash at that entity also?

There is, but to be honest with you, I can't remember the number.

The next question will come from Tom Lamb of Weybosset Research. Fla Lewis - Weybosset Research & Management LLC: Fla Lewis sitting in for Tom. Can you give us some information on the workings of the Diamond Green plant? While it was up there and producing at full, how are the markets for the product, as anticipated? If you were at full capacity, I guess, you didn't have any trouble selling it. But just -- can you just give us a little bit -- who the customers are and how it's going over with them?

Yes, this is Randy. I mean, the customers will remain anonymous, but let's just say that it's not a gas station out there. It's going into the pipeline. Most of the products leaving to be injected in our blends that leave the facility today. The product acceptance by the oil companies is tremendous, to a degree they can't get enough of the product. It's exceeded our expectations on what the value of the product is relative to where we thought it would be. I mean, there's adequate demand to take the plant on up to nameplate capacity, and then anything above nameplate capacity can then be moved into the LCFS market in California, if need be. So we don't see any bottlenecks as far as a customer acceptance and demand standpoint. The challenge for us is, is that for Gary and his team down there in play, is just that they're -- they sit adjacent to the St. Charles refinery, which is a very significant asset for the Valero team. And then we have to be a part of the family and play well in the sandbox. And so at the end of the day, the outbound logistics always have to be balanced with what they have coming in and going out. And it's a learning curve for the team down there. But the Valero team has done a fabulous job, and I think they're ready for this thing to run the big numbers and start pushing the products out. Fla Lewis - Weybosset Research & Management LLC: So if we make it, they'll buy it?

Well, they're not the buyer of it... Fla Lewis - Weybosset Research & Management LLC: No, no, I mean...

Yes, they will help us get -- they'll put it in the pipeline for us.

The next question will come from DeForest Hinman of Walthausen & Co. DeForest R. Hinman - Walthausen & Co., LLC: Just 2 questions. One, is building off from some of the questions around the JV. You disclosed the debt, you didn't talk about the cash. But just thinking mathematically about that plant, it probably is going to be generating cash flow at some point. How do we think about dividends or cash coming out of that JV going forward? Is that an assessment at year end type of thing? Or could we be seeing some quarterly disbursements from that JV at some point?

Yes. The way the joint venture agreement works, there are no cash distributions in '13. Part of that was related to the fact that as that facility came out there, there's significant bonus depreciation that gets allocated to each of the [indiscernible] partners that saves us a significant amount of cash tax and in effect, that's how the JV thought about cash distributions, if you will, back to the partners. Starting in '14, we would anticipate cash distributions. When you think about the profitability, they do have debt. We have to make sure we maintain a reasonable level of working capital inside the joint venture and then some funds for, obviously, for CapEx and maintenance and those sorts of things. But we would just expect a reasonable level of cash distributions starting in '14. DeForest R. Hinman - Walthausen & Co., LLC: Okay. And then, can you just give us an update on the blender funding credit? Is that still something that we're going to be seeing in the fourth quarter running through that JV?

Absolutely. We qualify for that. The paperwork is being filed, or constantly and consistently filed with the right agency. And you'll continue to see that through the end of the year here. As we discussed earlier in the call, the outlook for that is probably negative to unknown right now, given that Congress can't agree on anything. So we're kind of operating with the bias to make as much as we can get done this year and then making sure that RINs will adjust themselves in the first quarter, which they already have to some degree to help offset any reduction or disappearance of that credit.

And I might add to Randy's comment, if we think back a year-plus ago when the credit was reinstated, what you basically saw was the RIN value drop $1. So if the RIN credit -- or excuse me, if tax credit goes away, then we would expect the RIN values to be impacted by that.

But diametrically, the opposite way. So if RINs are $0.35 today, I think you'll take back 60% to 70% of that number and your RINs will go above $1 again.

And ladies and gentlemen, that will conclude our question-and-answer session. I would like to turn the conference back over to Mr. Randall Stuewe for his closing remarks.

Thanks, Denise. Appreciate everyone taking time to join us today. As we said, we'll continue to update you as things become available and necessary here. And otherwise, we'll talk to you after the end of '13 here. Appreciate everybody's support, and have a great holiday season. Thanks.

Ladies and gentlemen, the conference has now concluded. We thank you for attending today's presentation. You may now disconnect.